The Bacchus Health-Care Bill was passed out of the Senate Finance Committee yesterday and even garnered the RINO vote of Olympia Snowe (R?—ME). Universally praised by Democrats and near-universally castigated by Republicans, the bill will now be integrated with the House bill, along with probably a zillion changes and additions — to be voted on by both houses of Congress in TWO WEEKS? So, even if this isn’t the final bill, just how much would Sen. Bacchus’ wet dream cost US? Douglas Holtz in today’s Wall Street Journal Online breaks it down:

Most astounding of all is what this Congress is willing to do to struggling middle-class families. The bill would impose nearly $400 billion in new taxes and fees. Nearly 90% of that burden will be shouldered by those making $200,000 or less.

It might not appear that way at first, because the dollars are collected via a 40% tax on sales by insurers of “Cadillac” policies, fees on health insurers, drug companies and device manufacturers, and an assortment of odds and ends.

But the economics are clear. These costs will be passed on to consumers by either directly raising insurance premiums, or by fueling higher health-care costs that inevitably lead to higher premiums. Consumers will pay the excise tax on high-cost plans. The Joint Committee on Taxation indicates that 87% of the burden would fall on Americans making less than $200,000, and more than half on those earning under $100,000.

Industry fees are even worse because Democrats chose to make these fees nondeductible. This means that insurance companies will have to raise premiums significantly just to break even. American families will bear a burden even greater than the $130 billion in fees that the bill intends to collect. According to my analysis, premiums will rise by as much as $200 billion over the next 10 years—and 90% will again fall on the middle class.

Senate Democrats are also erecting new barriers to middle-class ascent. A family of four making $54,000 would pay $4,800 for health insurance, with the remainder coming from subsidies. If they work harder and raise their income to $66,000, their cost of insurance rises by $2,800. In other words, earning another $12,000 raises their bill by $2,800—a marginal tax rate of 23%. Double-digit increases in effective tax rates will have detrimental effects on the incentives of millions of Americans.

Good ol’ so-called-Republican Sen. Olympia Snowe even presents a way for the combined bill to result in government-controlled health care:

Sen. Olympia Snowe, the only committee Republican who supported advancing the Finance panel bill, suggested Wednesday a scenario in which a government-run plan could eventually come into play.

Snowe told CBS’s “The Early Show” that she believes a public option would give the government “a disproportionate advantage” over private insurers, and said she still opposes the concept.

But at the same time, Snowe said that she wants “to make sure the insurance industry performs.” In a separate interview on ABC’s “Good Morning America,” she said that if the industry did not live up to congressional expectations for more widely affordable and accessible insurance, “you could have the public option kick in immediately.”

Just this last Monday the health insurance industry fought back a little and that has really tweaked the Dems, who now are seeking retribution in amendments to the combined bill.

Bolstering the claims that this bill would cost taxpayers via decreased income, Ed Morrissey at Hot Air examines a report by the Joint Congressional Committee On Taxation:

The problem with that is the definition of “high cost insurance products”. The JCT is not talking about the upper 5% of health-care plans, not even in the initial year. In the first year of the tax, the JCT predicts that 11% of all plans will be subject to the excise tax. By 2019, the JCT predicts that a third of all policies will carry that tax, increasing costs and depressing wages in one form or another.

And for those Liberals who still believe in the Tax-Business-To-Death-Tooth-Fairy Ed explains:

This should not be news to Hot Air readers. Most already understand that corporations don’t really pay taxes; they pass the costs to consumers in the form of higher prices or in lost jobs and economic opportunities. While populists love to see Congress stick it to corporate America, in essence this is nothing more than a form of economic masochism.

It’s totally safe to say that the combined bill will be even more expensive, have even more onerous taxation on the middle & upper classes, and if a public option gets signed into law, bring us a version of Canadian or British health care.

What could go wrong?

This entry was posted on Wednesday, October 14th, 2009 at 11:44 am and is filed under Dim Wit Dems, Health Care Wars. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.  |   Print This Post  |   Email This Post

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